Valuation is the act of determining a value or worth of property.  In Das Kapital (volume 1, chapter 1, footnote 1), we find the following curiosum:  “In English writers of the 17th century [e.g., John Locke (1632-1704)] we frequently find ‘worth’ in the sense of use-value, and ‘value’ in the sense of exchange-value.  This is in accordance with the spirit of a language that likes to use a Teutonic word for the actual thing, and a Romance word [MF, valuer] for its reflexion.”

The “fair” value of an intangible asset is the amount that such asset can be bought, sold, or settled in a transaction between willing parties, not involving forced or liquidation sale. A method often used in the valuation of intangible property determines the present value of the cash flows (profits) derived from using such property.  An alternative method determines the value of the enterprise, subtracts the value of financial and tangible assets, and assigns the residual value to intangible assets (but note that under this method the residual value includes goodwill, which must be separated from other identifiable intangible assets subject to further analysis).  Under either method, a search for comparable royalty rates is inescapable, because you need those royalty rates to value the identifiable intangible assets other than goodwill.  Identifiable intangibles include patent, trademark, trade name, copyright, supplier-based intangibles, proprietary technology, and customer-based intangibles.  Identifiable intangibles must have separate and distinct stream of expected profits in order to establish value using a present value method.

See FASB Statement No. 141, Business Combinations (June 2001):  www.fasb.org